12-Dec-2022: NIIF managed fund invested in 16 entities covering ports and logistics, renewable energy, roads, digital infrastructure, healthcare and manufacturing among others

The National Investment and Infrastructure Fund (NIIF) is set up as a collaborative investment platform between Government of India, Global Investors, Multilateral Development Banks (MDB) and Domestic Financial Institutions. This was stated by Union Minister of State for Finance Dr Bhagwat Kishanrao Karad in a written reply to a question in Lok Sabha today.

Giving more information, the Minister stated that NIIF currently has three funds namely Master Fund, Fund of Funds and Strategic Opportunities Fund that have invested in 16 entities covering ports and logistics, renewable energy, roads, digital infrastructure, healthcare and manufacturing among others.

The Memorandum of Understanding (MOU) was signed in November 2022 to facilitate investment across multiple sectors in India through an India Japan Fund.

The Minister further stated that funds of NIIF have investments from:-

1. Global investors such as Abu Dhabi Investment Authority (ADIA), AustralianSuper, Canada Pension Plan Investment Board (CPPIB), Ontario Teachers’ Pension Plan, PSP Investments, Temasek, US International Development Finance Corporation (US DFC)
2. MDBs such as Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), New Development Bank (NDB) and
3. Domestic Financial Institutions such as Axis Bank, HDFC Asset Management Company, HDFC Life Insurance, HDFC Limited, ICICI Bank and Kotak Life Insurance.

17-Nov-2022: Union Finance Minister Smt. Nirmala Sitharaman chairs 5th Meeting of Governing Council of National Investment and Infrastructure Fund (NIIF)

Union Minister for Finance & Corporate Affairs, Smt. Nirmala Sitharaman chaired the 5th meeting of the Governing Council (GC) of National Investment and Infrastructure Fund (NIIF), in New Delhi, yesterday (17th Nov. 2022) late evening.

The GC noted that NIIF has developed into an internationally credible and commercially viable investment platform, backed by several highly respected global and domestic investors who have invested alongside the Government of India in NIIF Funds.

NIIF’s first bilateral fund - an “India Japan Fund” with contribution from GoI has been proposed through an MoU between National Investment and Infrastructure Fund Limited (NIIFL) and Japan Bank for International Development (JBIC). The MoU was signed recently on 9th November, 2022. This key update regarding bilateral engagements of NIIF was endorsed by the GC.

The GC appreciated that the two infrastructure Non-Banking Financial Companies (NBFCs), where NIIF has majority stakes, have increased their combined loan book from ₹4,200 crore to ₹26,000 crore in 3 years without experiencing any non-performing loans (NPLs) till date.

The GC also guided NIIF to undertake advisory activities pro-actively to support central and state governments to create a pipeline of investible PPP projects.

The Finance Minister asked the NIIFL team to build on the work done so far and leverage India’s attractive investment fundamentals to expand its operations.  Smt. Sitharaman encouraged the team to continue discussions with investors from countries that are keen to invest in India.

The Finance Minister exhorted the NIIFL team also to explore opportunities under the National Infrastructure Pipeline, PM GatiShakti and National Infrastructure Corridor, which include a big pool of investible greenfield and brownfield investment projects, and to try and crowd in commercial capital into those opportunities.

During the meeting an update on the progress made by NIIF over the last few years and key learnings from its investment operations were presented to the Governing Council. The GC was apprised of the current status of the 3 funds that are currently managed by NIIFL – the Master Fund, the Fund of Funds (FoF), and the Strategic Opportunities Fund (SoF). The sectors that these funds focus on, the status of fund raise, and the kind of investments that have been made under them were shared with the GC. The GC was informed about the investments and performance of NIIF operating companies in sectors such as ports and logistics, renewable energy, and digital infrastructure besides its foray into sectors such as waste management, water treatment, healthcare, EV manufacturing.  

The other members of the GC that attended the meeting were Shri Ajay Seth, Secretary, D/o Economic Affairs; Shri Vivek Joshi, Secretary, D/o Financial Services; Shri Dinesh Khara, Chairman, State Bank of India (SBI); Mr. Hemendra Kothari, Chairman, DSP Group; and Mr. T.V. Mohandas Pai, Chairman, Manipal Global.

5-Dec-2019: Canada Pension Plan Investment Board to invest up to US$600 million through National Investment and Infrastructure Fund (NIIF)

National Investment and Infrastructure Fund (NIIF) of India and Canada Pension Plan Investment Board (CPPIB) announced an agreement for CPPIB to invest up to US$600 million through the NIIF Master Fund. The agreement includes a commitment of US$150 million in the NIIF Master Fund and co-investment rights of up to US$450 million in future opportunities to invest alongside the NIIF Master Fund.

With CPPIB’s investment, NIIF Master Fund now has US$2.1 billion in commitments and has achieved its initially targeted fund size. In addition, NIIF Master Fund investors have co-investment rights of US$3 billion, which will enable the NIIF Master Fund to invest at the scale required for India’s large infrastructure requirements. The NIIF Master Fund invests equity capital in core infrastructure sectors in India, with a focus on transportation, energy and urban infrastructure.

CPPIB joins Abu Dhabi Investment Authority, AustralianSuper, Ontario Teachers’ Pension Plan, Temasek, Axis Bank, HDFC Group, ICICI Bank and Kotak Mahindra Life Insurance as investors in the NIIF Master Fund, alongside Government of India.

CPPIB will also become a shareholder in National Investment and Infrastructure Fund Limited, NIIF’s investment management company.

About NIIF: NIIF is a fund manager that invests in infrastructure and related sectors in India. An institution anchored by the Government of India, NIIF is a collaborative investment platform for international and Indian investors with a mandate to invest equity capital in domestic infrastructure. NIIF benefits from its association with the Government yet is independent in its investment decisions being majority owned by institutional investors and managed professionally by a team with experience in investments and infrastructure. NIIF aims to make commercial investments in the sector at scale. NIIF Limited manages over US$4 billion of capital commitments across three funds, each with its distinct investment strategy. The funds have investment mandates to invest in infrastructure assets and related businesses that are likely to benefit from the long-term growth trajectory of the Indian economy.

About CPPIB: Canada Pension Plan Investment Board (CPPIB) is a professional investment management organization that invests the funds not needed by the Canada Pension Plan (CPP) to pay current benefits in the best interests of 20 million contributors and beneficiaries. In order to build diversified portfolios of assets, CPPIB invests in public equities, private equities, real estate, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City, San Francisco, São Paulo and Sydney, CPPIB is governed and managed independently of the CPP and at arm’s length from governments. At September 30, 2019, the CPP Fund totaled $409.5 billion.

3-Apr-2019: Roadis, NIIF to invest $2 billion

Roadis, a private investor and operator of transport infrastructure worldwide and the National Investment and Infrastructure Fund (NIIF) have jointly set up a platform to invest in road projects in India. The platform would invest up to $2 billion of equity targeting toll-operate-transfer models, acquisitions of existing road concessions and investment opportunities in the road sector with an aim to create a large roads platform in the country.

6-Sep-2018: Temasek to invest $400 million in NIIF

Singapore-based global investment firm Temasek has signed an agreement to invest up to $400 million in the National Investment and Infrastructure Fund (NIIF) of India with an option for co-investment with NIIF in the future.

As part of the agreement, Temasek will join the Government of India, Abu Dhabi Investment Authority (ADIA), HDFC Group, ICICI Bank, Kotak Mahindra Life Insurance and Axis Bank as an investor in NIIF’s Master Fund and as a shareholder in National Investment and Infrastructure Limited, NIIF’s investment management company.

With this investment, NIIF Master Fund is now one of the largest infrastructure funds in India, and will continue to raise capital so that it can invest at the scale required for the large infrastructure requirements in India. NIIF’s Master Fund invests in core infrastructure sectors in India with a focus on transportation, energy and urban infrastructure.

3-Aug-2018: Strategic Investment Fund under NIIF

As on date, three funds have been established by the Government under the NIIF platform and registered with SEBI as Category II Alternative Investment Funds and National Investment and Infrastructure Fund II (“Strategic Fund”) is one of those three funds. The other two funds are National Investment and Infrastructure Fund (or Master Fund) and NIIF Fund of Funds – I.

The objective of National Investment and Infrastructure Fund II (“Strategic Fund”) is to invest largely in equity and equity-linked instruments. The Strategic Fund will focus on green field and brown field investments in the core infrastructure sectors.

The NIIF Funds work on a model whereby equity participation from strategic partners (including overseas sovereign / quasi-sovereign / multilateral / bilateral investors) is invited, alongside Government’s contribution. Government’s contribution / share in the corpus will be 49% in each entity set up as an AIF and will neither be increased beyond, nor allowed to fall below 49%. The whole of 49% would be contributed by the Government of India directly.

NIIF Fund of Funds-I’s first investment has been in the Green Growth Equity Fund (GGEF). Department for International Development (DFID), an arm of the UK government, has committed to invest GBP 120 million (equivalent to INR 1,080 crore) in GGEF and NIIF Fund of Funds-I also committed to invest an equivalent amount.

24-Jun-2018: AIIB to invest $200 Mn in NIIF

The Asian Infrastructure Investment Bank will invest $200 million in India’s National Investment and Infrastructure Fund even as it assuaged concerns over China’s dominance over it and stressed that it works for all its shareholders.

The AIIB will invest $100 million in the NIIF’s fund of funds at present, followed by another $100 million later.

The AIIB has approved the concept note for lending $200 million to NIIF. Its board of directors at its meeting will take up the proposal for the first tranche of $100 million and the proposal for the second tranche would be taken up later.

The fund of funds will be invested in other funds. Two such funds have already been conceptualised, including a green growth fund which will also have investments from DFID.

India is already the largest borrower from the AIIB with $1.2 billion financing in six projects. In total, the AIIB has invested $4.39 billion in projects. India is the second largest shareholder of the AIIB with an 8.72 per cent stake.

The two-day annual meeting is being attended by Finance Ministers or representatives from all of AIIB’s member countries, as well as Finance Minister Piyush Goyal and Prime Minister Narendra Modi.

Though the AIIB has 86-member countries, China has the largest shareholding at about 31 per cent leading to concerns that it may increase the country’s influence across the region. There is no ban on investments by Chinese companies into India, except on security concerns or if the project is aimed at encouraging the Make in India initiative.

NDB credit rating agency: The proposal for setting up a credit rating agency for BRICS country is at an advanced stage. It is expected to move forward at the BRICS summit in Johannesburg in July.

23-Jan-2018: DP World, India’s NIIF to set up $3 billion investment platform

The National Investment and Infrastructure Fund (NIIF), India’s first sovereign wealth fund, and Dubai-based ports operator DP World Pvt. has announced the creation of an investment platform to invest up to $3 billion in ports, terminals, transportation and logistics businesses in India.

This is the first investment platform from NIIF and will see investment up to $3 billion of equity to acquire assets and develop projects in these sectors. The platform will also look at opportunities beyond sea ports such as river ports and transportation, freight corridors, port-led special economic zones, inland container terminals and logistics infrastructure, including cold storage.

The formation of partnership follows the memorandum of understanding signed in May 2017 and the visit to India by Sheikh Mohammed bin Zayed al Nahyan, crown prince of Abu Dhabi, and Sultan Ahmed bin Sulayem, chairman and CEO of DP World Group, in February 2016.

With a portfolio of 78 operating marine and inland terminals, DP World, majority owned by the Dubai government, is the world’s fourth biggest container port operator.

This is NIIF’s first investment and is a good example of how NIIF can work with international capital and expertise to invest at scale to build critical infrastructure in India. Under the terms of the pact, Abu Dhabi Investment Authority will invest $75 billion in India over a 10-year period. Out of the total, an amount of $1 billion has already been transferred to NIIF. The funds will be invested in roads and railway projects

Set up in 2015, the Indian government had created NIIF to catalyse capital from international and domestic investors into energy, transportation, housing, water, waste management and other infrastructure and allied sectors in India. NIIF’s strategy includes anchoring equity, quasi-equity and debt funds in partnership with investors targeting investments across the relevant sectors in India.

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 8-Dec-2021: FDI

Foreign Direct Investment (FDI) is one of the important drivers of economic growth and a source of non-debt finance for the economic development of India. FDI complements and supplements domestic investment. Domestic companies are benefited through FDI by way of enhanced access to supplementary capital and state-of-art-technologies, as also exposure to global managerial practices resulting into employment generation and accelerated growth of the sectors.

The details of foreign investment reported through routes of Foreign Direct Investment (FDI) inflow and Foreign Portfolio Investment (FPI) inflows (net) during the last five financial years are as under:

(Amount in USD Million)

To promote FDI, the Government has put in place an investor-friendly policy, wherein except for a small negative list, most sectors are open for 100% FDI under the Automatic route. Further, the policy on FDI is reviewed on an ongoing basis, to ensure that India remains attractive & investor friendly destination. Changes are made in the policy after having intensive consultations with stakeholders including apex industry chambers, Associations, representatives of industries/groups and other organizations taking into consideration their views/comments.

Government has also taken various steps to improve the overall business regulatory environment in the country and create a conducive business environment by streamlining the existing regulations and processes and eliminating unnecessary requirements and procedures.

Recently, Government has taken various steps in addition to ongoing schemes to boost domestic investments in India. These include the National Infrastructure Pipeline, Reduction in Corporate Tax, easing liquidity problems of NBFCs and Banks, trade policy measures to boost domestic manufacturing. Government of India has also promoted domestic manufacturing of goods through the public procurement order, Phased Manufacturing Programme (PMP), Schemes for Production Linked Incentives of various Ministries.

1-Dec-2021: Foreign Investment

The details of foreign investment reported through routes of Foreign Direct Investment (FDI) inflow and Foreign Portfolio Investment (FPI) inflows (net) during the last five financial years are as under:

Source: Reserve Bank of India.

As shown in table above, despite COVID-19 pandemic, the country has shown growth both in FDI inflow and FPI inflows (net) during Financial Year 2020-21 as compared to previous Financial Year 2019-20.

4-Aug-2021: India registered its highest ever annual FDI Inflow of US $81.72 billion during the last financial year 2020-21

Make in India is an initiative which was launched on 25thSeptember, 2014 to facilitate investment, foster innovation, build best in class infrastructure, and make India a hub for manufacturing, design, and innovation. Development of a robust manufacturing sector continues to be a key priority of the Indian Government. It was one of the first 'Vocal for Local' initiatives that exposed India's manufacturing domain to the world. The sector has the potential to not only take economic growth to a higher trajectory but also to provide employment to a large pool of our young labour force.

Make in India initiative has made significant achievements and presently focuses on 27 sectors under Make in India 2.0. Department for Promotion of Industry and Internal Trade is coordinating action plans for manufacturing sector, while Department of Commerce is coordinating service sector.

Activities under Make in India initiative are being undertaken by several Central and State Government departments from time to time. Programme specific data of such activities and details of foreign companies are not centrally maintained.

India has registered its highest ever annual FDI Inflow of US $81.72 billion (provisional figure) during the last financial year 2020-21 as compared to US $ 45.15 billion in 2014-2015. In the last seven financial years (2014-20), India has received FDI inflow worth US$ 440.01 billion which is 58 percent of the FDI reported in the last 21 years (US$ 763.58 billion).

23-Jun-2021: India attracted US$ 6.24 billion total FDI inflow during April, 2021

Measures taken by the Government on the fronts of Foreign Direct Investment (FDI) policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country. The following trends in India’s Foreign Direct Investment are an endorsement of its status as a preferred investment destination amongst global investors:

• India has attracted total FDI inflow of US$ 6.24 billion during April, 2021 and it is 38% higher as compared to April, 2020 (US$4.53 billion).
• During April, 2021FDI Equity inflows amounting to US$ 4.44 billion were reported in the country which is an increase of 60% over the FDI Equity inflow of April, 2020 (US$ 2.77 billion).
• During April, 2021,Mauritius is the top investing country with 24% of the FDI Equity inflows, followed by Singapore (21%) and Japan (11%).
• ‘Computer Software & Hardware’ has emerged as the top sector during April, 2021 with around 24%share of the total FDI Equity inflow followed by Services Sector (23%) and Education Sector (8%) respectively.
• Karnataka is the top recipient state during April, 2021 with 31% share of the total FDI Equity inflows, followed by Maharashtra (19%) and Delhi (15%).

12-Feb-2021: FDI inflows in food processing sector increase from USD 628.24 Million in 2018-19 to USD 904.7 Million in 2019-20

The Government has put in place a liberal and transparent policy for attracting Foreign Direct Investment (FDI), wherein most of the sectors are open to FDI under the automatic route. The intent is to make the FDI policy more investor friendly and remove the policy bottlenecks that have been hindering the investment inflows into the country. 100% FDI is permitted under the automatic route in the food-processing sector.

The reforms and policy measures initiated by the Government had a positive impact on FDI inflows into the country. As per the World Investment Report 2020 of United Nations Conference on Trade and Development (UNCTAD), India’s position among top economies attracting FDI inflows has improved to 9th position in 2019 from 12th in 2018. India registered its highest ever FDI inflows of USD 74.39 billion (provisional) during 2019-20. Even during the Covid pandemic between April and November, 2020, total FDI inflows of USD 58.37 billion has been received. The FDI inflows in the food processing sector also increased from USD 628.24 Million in 2018-19 to USD 904.7 Million in 2019-20.

Ministry of Food Processing Industries has also set up a dedicated Investment Facilitation Cell with Invest India to facilitate all investment interests received in the food processing sector. The Cell handholds investors throughout the investment phases in a structured manner by providing relevant sectoral & sub-sectoral information, assisting with regulatory requirements, location assessment, applicable policies and schemes etc.

27-Jan-2021: Total FDI inflow of US$ 58.37 billion received during April to November, 2020

Foreign Direct Investment (FDI) is a major driver of economic growth and an important source of non-debt finance for the economic development of India. It has been the endeavor of the Government to put in place an enabling and investor friendly FDI policy. The intent all this while has been to make the FDI policy more investor friendly and remove the policy bottlenecks that have been hindering the investment inflows into the country. The steps taken in this direction have borne fruit, as is evident from the ever-increasing volumes of FDI inflows being received into the country.

Measures taken by the Government on the fronts of FDI policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country. The following trends in India’s Foreign Direct Investment are an endorsement of its status as a preferred investment destination amongst global investors:

• During April to November, 2020, total FDI inflow of US$ 58.37 billion has been received. It is the highest ever for first 8 months of a financial year and 22% higher as compared to first 8 months of 2019-20 (US$ 47.67 billion).
• FDI equity inflow received during F.Y. 2020-21 (April to November, 2020) is US$ 43.85 billion. It is also the highest ever for first 8 months of a financial year and 37% more compared to first 8 months of 2019-20 (US$ 32.11 billion).

28-Nov-2020: US$28.1 billion FDI inflows into the country during the July-September quarter

Total Foreign Direct Investments (FDI) inflows into India during the second quarter of financial year 2020-21 (July, 2020 to September, 2020) have been US$ 28,102 million, out of which FDI equity inflows were US$ 23,441 million or Rs. 174,793 crore. This takes the FDI equity inflows during the financial year 2020-21upto September 2020 to US$30,004 million which is 15% more than the corresponding period of 2019-20. In rupee terms, the FDI Equity inflows of Rs 224,613 Crore are 23% more than the last year. August, 2020 has been the significant month when US$ 17,487 Million FDI equity inflows were reported in the country.

In terms of the Countries from where FDI Equity Inflows were reported to India, during April, 2000 to September, 2020; maximum FDI Equity inflows have been reported from Mauritius, followed by Singapore and the USA.

Among the sectors, Services sector has received maximum FDI equity inflows, during April, 2000 to September, 2020; followed by Computer Software & Hardware, and Telecommunications.

Gujarat has been the major beneficiary state of the FDI Equity inflows, during October, 2019 to September, 2020;followed by Maharashtra and Karnataka.

2-Aug-2017: India, ASEAN-5 to fetch more FDI than other emerging markets

As per a report, India along with Indonesia, Malaysia, Thailand, the Philippines and Vietnam has emerged as attractive destinations to FDIs as compared to other emerging markets and flows to these nations are expected to surge to around USD 240 billion by 2025.

For the same reason, India and ASEAN-5 (Indonesia, Malaysia, the Philippines, Thailand and Vietnam) have been dubbed as “Asia’s tiger cubs“. Moreover, sources of FDI to these nations are also witnessing a significant shift with more inflows expected from countries as China and Japan.

Rising labour costs in China and an ageing population in Northeast Asia have disincentivized foreign direct investment (FDI) and they are in search of new destinations. India and the ASEAN-5 are well placed to emerge as that destination.

Other factors that are expected to encourage FDI into India and ASEAN-5 include – large and growing domestic markets; reforms focussed on improving infrastructure and the ease of doing business; a more open and liberal FDI regime; sound economic management and political stability; and availability of low-cost labour.